BL Premium reports that the Passenger Rail Agency of SA (Prasa) has bowed to pressure from workers by committing to increase their salaries after a union mounted legal action to force the rail operator to implement a multiyear wage agreement agreed to in October.
Prasa announced in March that it was going through a “debilitating cash-flow crunch” that had depleted its operational budget, resulting in it failing to pay suppliers and creditors. Since the start of the Covid-19 lockdown in March, it has lost R199m. The revenue loss projected for 2020 is R757m. On 23 October, Prasa signed with an agreement with unions Untu and Satawu that will see workers getting a 5% salary increase each year for three years. However, on 20 November Prasa wrote to the unions saying Prasa was awaiting an “update” from the Treasury on the agreement, stressing that the process to implement the deal was taking longer than anticipated. Untu then approached the Labour Court to force the operator to honour the agreement, but its application was dismissed because it was not urgent. Nonetheless, Prasa’s acting group CE has now confirmed in writing that the agency would implement the agreed 5% wage increase on 22 December, backdated to 1 April. This is way above consumer inflation, which was 3.2% as of November. It is not yet clear where Prasa will get the money to fund the increase.
- Read the full original of the report in the above regard by Luyolo Mkentane at BusinessLive (paywall access only)
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